What Happened to Steve Rattner?

It is, so far, the strange case of Steven Rattner and his abrupt and unexplained exit from Washington and the Obama administration—but insiders assume that this story of the ultimate (or would-be ultimate) insider will, rather sooner than later, come clear.

Rattner is the self-styled, politically-savvy, fabulously well-connected financier who went to Washington as the almost-car czar. That is, he was supposed to be the car czar but by some sleight of hand he was demoted—given the job but without the title (which might have had something to do with his wife’s drunk-driving conviction and his efforts to have the press hush it up). And car czar was a far-step-down from the Treasury secretary job he’d hoped for—alas, he was a Hillary rather than Obama supporter.

Yesterday, he left the car czar job after six months. This probably has something to do with the New York State attorney general’s investigation of Rattner’s former company’s involvement in an alleged scheme to obtain state pension fund investment monies—although this investigation has been publicly going on since he took the almost-czar job.

This story is fascinating to insiders and probably to no one else because the design of his career—he began as a New York Times reporter, became an investment banker, then raised gobs of money for the Clintons—was to be the quintessential insider for our time.

Rattner, one of the closest advisers to the publisher of the New York Times and to the mayor of (and richest men in) New York, saw himself in the role of what used to be called a “wise man.” These were lawyers and Wall Street types—like Robert A. Lovett, John J. McCloy, and after that the Bundy brothers—who went to Washington, starting in the New Deal years, to wield behind-the-scene power.

It was really a class idea, or an idea about the nature of the establishment. Whatever happened in the world, there were certain men you could always count on for their brains and fealty. Now surely this was a totally bogus conceit, and these guys were as grasping and craven and as calculated social climbers as Steve Rattner. But they got away with it, and Steve Rattner, in this crueler time, did not.

Not that I think Steve Rattner is any lesser or any different from most other i-banker-turned-private-equity guys who’ve raised a lot of money for politicians. He just wanted to be thought of as something more—something more sublime. It pained him when he wasn’t thought of like this—it seemed to nearly kill him when he was portrayed as a man struggling up the greasy pole (I have been one of the people who regularly portrayed him as such).

The New York State attorney general’s investigation of Rattner—Andrew Cuomo is himself trying desperately to climb the greasy pole—is at such a level of irony. Rattner is being singled out for exactly what everybody else in the world of private equity has done: Paid off middle-men to get the big dough. Not only is he not better than everyone else, it seems he’s going to be publicly damned for being the same.

I never met a public man who hated bad press as much as Rattner. New York magazine has been preparing a long piece on Rattner, the prospect of which alone may have run him out of office. His view of himself was just too perfect, or composed, or demanding. He even looks so breakable—like a figurine.

He may be of no interest to anyone else, but to the insiders, the people who think they know what it’s all about, he’s a cautionary tale, further details of which will surely unfold.

More of Newser founder Michael Wolff's articles and commentary can be found at VanityFair.com, where he writes a regular column. He can be emailed at michael@newser.com.

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